TIDMPFD
RNS Number : 8317T
Premier Foods plc
23 July 2015
Premier Foods plc (the "Company" or the "Group")
Trading update for the 13 weeks ended 4 July 2015
-- Q1 Branded sales down (1.4%); Group sales down (1.6%) reflecting earlier Easter
-- Market share gains in Cake, Ambient Desserts and Flavourings & Seasonings
-- Sweet Treats delivering increased volumes and sales following recent brand investment
-- Grocery brands demonstrating encouraging volume trends
-- Expectations for Full Year remain unchanged
Gavin Darby, Chief Executive Officer
"We are encouraged by the continued good volume and value
response of our brands in those areas where we have focused our
investment, although Branded sales in the quarter were impacted by
the earlier timing of Easter. While the business environment
remains challenging, our expectations for the year, including a
significant reduction in Net debt, remain unchanged."
Q1 Sales Grocery Sweet Group
Treats
% change
Branded (2.0%) 0.1% (1.4%)
Non-branded (9.8%) 11.1% (3.1%)
-------- -------- -------
Total (2.7%) 1.4% (1.6%)
Trading update
The Group's sales in the first thirteen weeks of the year were
GBP166.2m, with branded sales (1.4%) lower and total sales down
(1.6%). The Group's branded sales mix was slightly higher at 90.3%,
while gross margins in the quarter were in line with the prior
year. Non-branded sales were GBP0.5m lower with a strong
performance in Sweets Treats offset by declines in Grocery.
The slightly lower branded sales performance in the quarter was
affected by the timing of Easter this year, which impacted both the
Cake and Flavourings & Seasonings categories. This Easter
effect is equivalent to approximately 1 1/2 % of branded sales, and
therefore taking this into account, branded sales would have
otherwise delivered a broadly flat result in the quarter. Aside
from this effect, the Sweet Treats business has continued to enjoy
the benefits of renewed focus and marketing investment, delivering
both volume and value share growth and is expected to benefit from
new product launches over the coming months. In the Grocery
business, Bisto and Oxo sales performed well, while Loyd Grossman
sales were held back due to re-phasing of our annual promotional
plan.
In aggregate, the Company's market share was broadly flat across
its categories in the quarter, with gains in Cake, Flavourings
& Seasonings and Ambient Desserts offset by weaker performances
in Cooking Sauces and Light Meals. These trends are in line with
management expectations and reflect relative levels of marketing
and innovation investment by the Company in the respective
categories over the last twelve months.
Building on the Company's recent new product development
launches using gel pot technology, Oxo Stock Pots, a premium
gel-based stock product will be launched into market shortly. Other
products launched in the quarter which align to consumer trends of
premiumisation and foodieness include Loyd Grossman Pan Melts and
Sharwood's Stir Fry Melts. The Company is also launching a number
of exciting new Cadbury products into market this year. A range of
ambient desserts have just been introduced which are performing
ahead of expectations, and these will be followed by Cadbury Hot
Cakes and Cadbury Amaze Bites products which have received a very
encouraging response from our major customers. These launches will
be supported by television advertising with eight of the Company's
brands planned to benefit from such investment in this financial
year.
The Company's expectations for Net debt for the Full Year remain
unchanged. The Company recently reduced the size of its Debtors
securitisation facility from GBP120m to GBP80m, reflecting a
smaller debtor's book following the completion of the Hovis joint
venture transaction in 2014. The interest rate and maturity of the
facility are unchanged and the new GBP80m facility remains adequate
for the Company's requirements; as at 4 April 2015, GBP19.7m of the
facility was drawn.
Outlook
The Company's commitment to brand investment continues, with
consumer marketing expenditure planned to increase materially in
2015/16. While we expect the trading environment to remain
challenging, our expectations for the year, which include a
significant reduction in Net debt, are unchanged.
Ends
For further information, please contact:
Institutional investors and analysts:
Alastair Murray, Chief
Financial Officer +44 (0) 1727 815 850
Richard Godden, Head of
Investor Relations +44 (0) 1727 815 850
Media enquiries:
Richard Johnson, Group
Corporate Affairs Director +44 (0) 1727 815 850
Maitland +44 (0) 20 7379 5151
Greg Lawless
Tom Eckersley
Conference Call
A conference call for investors and analysts will take place on
23 July 2015 at 9.00am, details of which are outlined below. A
replay of the conference call will be available on the Company's
website later in the day.
http://www.premierfoods.co.uk/investors/results-centre
Telephone number: +44 20 7192 8000
Telephone number (UK Toll
free) 0800 376 7922
Conference ID: 83829272
Notes to editors:
1. All sales data is for the thirteen weeks to 4 July 2015 or 5
July 2014 as appropriate.
2. Q1 sales segmental disclosure:
Q1 Sales (GBPm) FY16 Q1 FY15 Q1 % Change
Grocery
Branded 110.1 112.4 (2.0%)
Non-branded 10.2 11.3 (9.8%)
-------- -------- ---------
Total 120.3 123.7 (2.7%)
Sweet Treats
Branded 40.0 39.9 0.1%
Non-branded 6.0 5.4 11.1%
-------- -------- ---------
Total 46.0 45.3 1.4%
-------- -------- ---------
Group
Branded 150.1 152.3 (1.4%)
Non-branded 16.2 16.7 (3.1%)
-------- -------- ---------
Total 166.3 169.0 (1.6%)
-------- -------- ---------
3. Gavin Darby, Chief Executive Officer, will make a short
presentation at the Company's Annual General Meeting, today, 23
July 2015. Included in this presentation are the following market
data statistics, sourced by IRI for 26 weeks ended 27 June
2015.
Category Volume Sales Share
growth
Flavourings & +2.2% - - -
Seasonings
Bisto +2.2% +1% +4% +0.4ppt
Oxo +2.2% +2% +2% +0.0ppt
Cake +2.1% - - -
Mr. Kipling +2.1% +13% +6% +0.7ppt
Cadbury +2.1% +19% +11% +0.6ppt
Certain statements in this Trading Update are forward looking
statements. By their nature, forward looking statements involve a
number of risks, uncertainties or assumptions that could cause
actual results or events to differ materially from those expressed
or implied by those statements. Forward looking statements
regarding past trends or activities should not be taken as
representation that such trends or activities will continue in the
future. Accordingly, undue reliance should not be placed on forward
looking statements.
A Premier Foods image gallery is available using the following
link:
http://www.premierfoods.co.uk/media/image-gallery
This information is provided by RNS
The company news service from the London Stock Exchange
END
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